Mncs : Global Economy And Political Affairs Essay

Mncs : Global Economy And Political Affairs Essay

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Most mining MNCs are big corporations based in industrialized countries. Over the past few decades, MNCs have become influential in global economies and political affairs. MNCs play a dominant role in natural resource-based economies such as Zambia. Their taxes on earnings constitute 90% of government revenues. The combined total earnings of the world 's top 10 biggest MNCs exceed the gross domestic income of 100 of the world 's poorest countries. The foregoing research findings put the influence of MNCs into perspective. Examples of MNCs include Glenco Xtrata (Switzerland), BHP Billiton (Australia), Rio Tinto (British-Australia), Vale (Brazil), Anglo American (Britain), China Shenhua Energy (China) and Barrick Gold (Canada). Outside the mining industry, Starbucks exemplifies the reach of MNCs. Originating from the United States Starbucks has multiples operations in the United States and other countries around the globe. In the global automotive industry, Ford and General Motors are two companies with a global presence which exemplify the wealth of multinational corporations. The total annual earnings of the two MNCs exceed the combined gross domestic earnings of all the economies in sub-Saharan Africa. The significance of this statistic is that the capital responsible for economic activities in most economies in sub-Saharan Africa is foreign owned. With a little over 10% of the global population, sub-Saharan Africa is characterized by indigenous communities in which the mining MNCs generate profits. The role of the MNCs in addressing the social and economic concerns of the inhabitants of the host communities remains unclear.
Different views of MNC
During the last 20 years, scholars have debated about the impact of economic...

... middle of paper ...

...pose and intent of business are to make a profit and increase shareholder value. Scherer, Palazzo, and Matten (2014) asserted that governments have a conflict of interest in developing policies that compel MNCs to improve lives in host communities as governmental priority is attracting foreign investors. When businesses are can operate in a highly profitable environment with limited regulations, the country becomes an attractive investment destination (Scherer et al., 2014). Since the interest of governments may conflict with those of the global corporations, governments and businesses may be perpetuating low quality of life in host communities (Dahan & Raelin, 2015; Kolk, 2015; Wettstein, 2009). Consequently, the solution offered by various researchers entails an integrated approach with defined roles for governments and businesses (Kolk, 2015; Wettstein, 2009).

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